Fixed rate mortgages

Lenders generally offer fixed rate mortgages for 10, 15 and 30 years. The longer your loan term, the lower your monthly payment will be. A shorter loan term may increase your payment but you could pay off your home faster.

Fixed rate mortgages can make budgeting much easier. They're the most popular choice for homeowners, especially those who plan to stay in their home for many years.

With a shorter loan term, your payment may be higher but you're likely to build equity faster.

Adjustable rate mortgages (ARMs)

An adjustable rate mortgage (ARM) has a lower, fixed interest rate for a set initial time period then adjusts to financial market rates for the rest of the loan term. That means your monthly payment can be lower at first but may increase if mortgage interest rates go up.

Since your payments will be lower for the initial period, an ARM may be a good option if you plan to pay off the mortgage or move before the variable part of the mortgage starts.

The most common ARM types are often advertised as 3/1 or 5/1 ARMs. The first number shows how long the fixed interest-rate period will be. The second number shows how often the rate will adjust after the initial period. For example, a 5/1 ARM is fixed for the first 5 years then adjusts every year afterward.

New and existing Citi customers may qualify for lower interest rates or discounted closing costs on a mortgage.

Frequently asked question

How often does the interest change on an adjustable rate mortgage (ARM)?

The frequency of interest change depends on the ARM. The most common type of ARM is called a Hybrid ARM, often advertised as 3/1 or 5/1 ARMs. This offers a fixed rate for an initial period of time, before adjusting to the current market rate. The first number tells you how long the fixed interest-rate period will be, and the second number tells you how often the rate will adjust after the initial period. For example, a 5/1 ARM is fixed for the first 5 years, before adjusting every year thereafter.

This page of citi.com contains information about U.S. domestic financial services provided by the Citigroup family of companies and is intended for use domestically in the U.S. Terms, conditions and fees for accounts, products, programs and services are subject to change.

Important Information

You are leaving a Citi Website and going to a third party site. That site may have a privacy policy different from Citi and may provide less security than this Citi site. Citi and its affiliates are not responsible for the products, services, and content on the third party website. Do you want to go to the third party site?

Citi is not responsible for the products, services or facilities provided and/or owned by other companies.

Important Information

You are leaving a Citi Website and going to a third party site. That site may have a privacy policy different from Citi and may provide less security than this Citi site. Citi and its affiliates are not responsible for the products, services, and content on the third party website. Do you want to go to the third party site?

Citi is not responsible for the products, services or facilities provided and/or owned by other companies.

Important Information

You are leaving a Citi Website and going to a third party site. That site may have a privacy policy different from Citi and may provide less security than this Citi site. Citi and its affiliates are not responsible for the products, services, and content on the third party website. Do you want to go to the third party site?

Citi is not responsible for the products, services or facilities provided and/or owned by other companies.